Michael Vargas

  • August 11, 2016
    Guest Post

    by Michael Vargas, Associate at Rimon

    In his Citizens United v. FEC dissent, Justice Clarence Thomas sent up a signal flare that could have far greater repercussions than the landmark decision itself. In his dissent, Justice Thomas argued that disclosure requirements on corporations were unconstitutional compelled speech because they opened up corporations to public reprisal for the information found in those disclosures, and he steadfastly rejected the argument that these disclosure requirements could be justified on the grounds that they simply “provided voters with additional information.” This startling pronouncement, if applied to all corporate “speech,” would effectively nullify all corporate disclosure laws currently on the books, including most if not all Wall Street regulations. This fear was largely an academic one, until the D.C. Circuit ruled, in National Association of Manufacturers v. SEC, that the Securities and Exchange Commission (SEC) rules on Conflict Minerals were unconstitutional in an opinion that sounds remarkably similar to Justice Thomas’ Citizens United dissent. There can be no doubt that all federal regulation that uses disclosure as a means of oversight is now in very real peril from conservative judges who adhere to Thomas’ beliefs.

    The Battle to Prohibit Conflict Minerals

    For the people of Zaire, 1996 brought with it the end of the repressive and corrupt dictatorship of Joseph Mabutu, and the beginning of a series of civil wars that continue to rage today. The country, renamed the Democratic Republic of the Congo (DRC) in 1997, is a humanitarian nightmare, as warlords and mercenaries use rape and murder to enslave the population and put them to work in mines extracting minerals such as gold, tin, tungsten and tantalite (3TG). These 3TG minerals, used to manufacture many high-tech devices such as cellphones and computers, are then sold in western markets with the proceeds used to finance the civil war in the DRC. International human rights organizations and even the United Nations have long identified these “conflict minerals” as one of the most important humanitarian crises in the world today.

  • August 9, 2016
    Guest Post

    by Michael Vargas, Associate at Rimon 

    No issue has commanded more attention in the past 12 months than economic justice, and given the historic, and growing, chasm between the global one-percent and the rest of world, it’s not hard to see why Americans are so focused on this issue. The solutions being proposed by progressive lawmakers and activists, however, seem to be stuck in the past.  To be sure, reviving the regulatory ideals of FDR’s New Deal and LBJ’s Great Society, would likely have a positive impact on economic inequality, but to truly achieve a just and inclusive economy, there needs to be a cultural shift in American business, a shift away from the profits-only mentality that brought about the Great Recession and toward an acknowledgement that businesses can and must be accountable to their communities and society. A top down, regulation-heavy solution can create the checks and oversight needed to police bad behavior, but regulation alone cannot create the cultural change that will bring about a just and inclusive economy that will stand the test of time.             

    Fortunately, activists within the business community have been hard at work creating a business entity that can do what regulation cannot. It is called the “benefit corporation,” and, although it has only been around for a short while, there is a large and growing community of social entrepreneurs and innovators who are using these companies to bring about precisely the kind of cultural shift progressives have been trying to achieve for more than a century. This post will introduce you to this revolutionary idea sweeping the business world, but we cannot bring about the kind of change we want without the support of other members of the progressive community. We need progressive lawyers, policy-makers and activists to support this movement as a necessary addition to the movement for re-regulation.

    How We Got Here            

    For almost a century, a debate has been raging within the field of corporate law over the proper purpose of the business enterprise. On the one side are those who argue that profit alone should be the sole motivator for business activities, a position that was most forcefully advocated by law and economics scholars in the 1970s. On the other are those who argue that profits must be balanced with a genuine concern for the needs of society, which we would today call “corporate social responsibility” or “CSR.” For decades the two sides in the debate jockeyed for prominence, until President Reagan tipped the balance in favor of law and economics. Reaganomics was the extension of these principles at the level of the national economy, and the business community largely took advantage of the opening to prioritize profits. Today there is little doubt that law and economics remains the dominant force in corporate law.               

  • August 20, 2015
    Guest Post

    by Michael Vargas, Associate, Rimon, PC. Vargas is programming co-chair of the Bay Area Lawyer Chapter.

    When President Obama nominated then-Georgetown law professor Chai Feldblum for a seat on the Equal Employment Opportunity Commission (EEOC) in 2009, it was clear that the former counsel to the Employment Non-Discrimination Act (ENDA) was going to shake up the Commission. As the first openly LGBT person to sit on the Commission, she did not disappoint. In 2012, the Commission announced its unanimous decision in Macy v. Holder (ATF), holding that discrimination against transgender employees was sex discrimination and actionable under Title VII. On July 16, 2015, the Commission issued an even more revolutionary decision in Complainant v. Foxx (FAA), holding that discrimination on the basis of sexual orientation is also sex discrimination and, therefore, must also be actionable under Title VII.

    In the EEOC’s decision, an unnamed complainant filed a complaint alleging that his supervisor would say things like “we don’t need to hear about that gay stuff” whenever the claimant would talk about his partner, and that he was subsequently denied a promotion. In dismissing the case, the FAA treated the complainant’s sexual orientation claim as separate from his sex discrimination claim and therefore not appealable to the EEOC.

    The EEOC summarily reversed the FAA, holding that sexual orientation was “inherently a sex-based consideration” and therefore was “necessarily an allegation of sex discrimination under Title VII.” The EEOC rested their decision on three different theories:

    First, the EEOC argued that sexual orientation necessarily involves treating employees differently because of their sex. To illustrate, the Commission gave the example of a male employee who is fired for having a picture of his husband on his desk when female employees with pictures of their husbands on their desks are not. This, the Commission declared, would be a classic case of sex discrimination.

    Second, the Commission found that sexual orientation discrimination was essentially associational discrimination, which is already recognized in the race discrimination context. If a person cannot be discriminated against because of the race of their spouse, then so too should they be protected from discrimination because of the gender of their spouse.

    Finally, the Commission recognized that discrimination against gays and lesbians is tinged with sex stereotypes, or expectations about what men or women should or should not do, which is yet another form of prohibited sex discrimination.